A Purely Digital Bank

“Our vision statement is actually to be the first telepathic bank. One thought is that if banking is to be helpful — it has to be predictive. And if it’s predictive, why do you actually have to go to your bank?”

Insightive.tv: Tell us about the Atom business model.

Stewart: The whole Atom business proposition is to be low cost and therefore better value to consumers.

If you look at all of the banking apps in the market today — they are just seen as a window onto a lengthy proposition that operates on some sort of multi-channel type environment. We don’t — this is just built for digital. Our view is that the level of that experience can be significantly better than anything out there.

Insightive.tv: What does your app offer, and does this mean that the whole process is digital?

Stewart: We use 3D animation to build our app. There is no 2×2, list boxes, there is no menuing. It is completely contextual. We actually bring you contextual information in real time.This is built to deliver a complete step-change in digital experience in the banking sector.

Some people think that we will be distant or remote. We think the opposite. As a digital brand, we are actually in your pocket or your handbag. We are much closer to you than any bank branch or call-centre. Even the Atom branding is unique to you. So, when you register, at that first stage, you get a unique brand that is completely yours. And it’s not just the brand logo, the whole application is completely orientated to you as an individual. The app itself can learn from how you bank, how you interact with us, and therefore your entire experience with Atom will be unique to you over time. This is 100% about giving you a personal experience that meets your needs.

We offer a support desk if customers get stuck on the technology. But, typically, the whole experience is digital. In fact, it’s mobile, and mobile only. It’s a complete self-service model, and in reality, that is the current Atom differentiator. We don’t see digital as another channel, this is an entirely digital business for those who want to bank through a self-service mechanism.

Stewart delineated the process people go through to join Atom —

Stewart: People can download the app, play with its features and then set up an account through digital identification-verification process.

It can sound long winded, but actually, if you have an invitation code to register you can download the app, go through the registration process, set up security, go through the Electronic Identification and Verification (eId&V) and open up an account — end-to-end — in about five minutes. There is no human intervention, no paper, no need to contact us in any shape or form.

And this is the long process. From then onwards, say you want to open a second account, that process takes about twenty seconds.

There is one additional credit check that goes on when offering mortgages and current accounts, which you don’t need on a savings products. But other than that, that end-to-end process is the same. It takes the same length of time — all of those checks and balances are all done behind the scenes in a fraction of a second as you move from one screen to the next.

Insightive.tv: How do you make sure your process complies with legal and regulatory compliance?

Stewart: One of the things we did was use biometrics as our authentification model. So you don’t need to use names and passwords at all. We actually use facial biometrics and voice biometrics. You are digitally verified, fundamentally, because you are signed into a secure app. The fact that we use biometrics makes it even more secure.

The only product we have at the moment where you need to sign things, and this is only because of ridiculously old legislation, is on a mortgage offer document — you still have to have a wet-signature. Other than that, all of our processes are built to be completely done in the app and no signature is required. You can’t do this more digitally than we have done it.

Insightive.tv: What are the biggest challenges you have faced in creating this new platform?

Stewart: Perception can be a problem. On security, for example, some customers love it and take it on board straight away. Others take longer to be convinced that it is secure. And that’s just because it’s groundbreaking — it’s new. And therefore you are constantly having to do things just to demonstrate to customers that this is real, and this is how fast it can be.

The sector itself can be challenging for a start-up because it tends to run at a very slow pace. The gearing of the industry is to take 18 months to do anything and cost tens-of-millions of quid. As a start-up, we can do things in hours or days, at the cost of thousands of pounds. That is a major challenge for anyone trying to innovate in this sector because the sector just isn’t geared in a way to respond in a way that is tangible.

Everything we have done has been signed-off by the regulator. But when you are a start-up, the whole process is educating. We have been both educating the customer and in some instances the regulator in terms of the art-of-the-possible.

We knew we were changing the game, and we knew that if we didn’t have the regulator involved from day one, it was going to be very hard to get it signed off in the end.

Insightive.tv: Do the legal challenges to digital contracts that have happened in the US give you concern, and how have you accommodated for this uncertainty?

Stewart: It’s built into the system. The legislation in the UK is different to that in the US, so I would not read too much into American developments. But the other part is it depends on your other terms and conditions.

We have four levels of terms and conditions. We didn’t have to have four levels, we did it to make the customer experience better. The first level is app terms and conditions — you are using this app and we need access to several things, your camera, for example, for biometrics. The next level is general banking Ts and Cs, which is not about a product, but if you want to do any banking with us, it is a necessary step. And then there are product specific terms and conditions.

You have to press a confirm and accept button, to the Ts and Cs of that product, and when you are doing that, that is legally binding. So when you are doing that, all of that legal wording is wrapped into the terms and conditions. That’s all digital — on the phone. But we also have a vault within the app — a document vault — that, at any stage, you can go open those documents within the app, and should you wish to print those, or email them to yourself, you can. So it’s all digital, and accepting those terms and conditions, we make it very clear: it’s you acknowledging the opening of the account and the conditions that come along.

Insightive.tv: How do you see things changing over the next three years?

Stewart: In the main, over the 3 year period, I actually don’t expect things to change very much. The reason for that is we are using the bleeding edge of technology, and therefore, there isn’t an awful lot more you can do to improve it. We have gone in with the best you can do.

We have some things in the pipeline. One is in the ID and verification process. You don’t have to use documents for that, and we will always have the ability available to do that without. But you are then dependent on the amount of information available through the Bureaus. Therefore, we may decline you today, even though you are completely legitimate, just because there is not enough information.

Basically, you will be able to take a picture of the document and load it into the app. It then takes about 12 seconds to certify your document electronically. At the moment, our decline rate is so low that we didn’t deem the additional step necessary. But when we get to current accounts and other products, we may introduce this to get more people through the process.

Insightive.tv: How about in the longer run?

Stewart: Our vision statement is actually to be the first telepathic bank. One thought is that if banking is to be helpful — it has to be predictive. And if it’s predictive, why do you actually have to go to your bank?

We are currently investing on artificial intelligence and predictive algorithms. We are looking to get to the stage where you don’t have to come to us. We’ll tell you if you can go out tonight, or how much money you have to spend on that handbag this week.

We fundamentally believe that the smartphone itself has a limited window — probably ten to fifteen years. So the other dimension is controlling your PC or Smartphone with your brainwaves. This is actually possible today. Now, sure, today you have to wear a silly hat in a lab. But if that is how you can control those things today in a lab, how many years is it going to be before that becomes your experience managing your life? It will start with voice over the next few years, but it will then move onto brainwave recognition. We recognise that banking will get to the stage that it will be completely predictive, and will be driven by thought, not by touch.

In the end, Stewart felt sure that the whole development process has to take hints from outside the industry —

Stewart: We are constantly looking for partners. It’s about finding companies with a similar mindset, and a similar culture of innovation. Developing those relationships is a big part of how we spend our time.

If customers are changing their experience, or behaviour, or expectations because of technology being used in retail, transportation or entertainment, then that is the technology we should be using in banking. So that is what we are doing, we look at things right across the page.

Stewart Bromley is Chief Operating Officer at Atom Bank. He has been with the company from day one and has a long history working in customer relations, innovation and digital solutions for the financial services — having previously been employed by HSBC and First Direct.

Atom Bank was founded in April 2014. It began trading in 2015 as the UK’s first digital only Bank. They currently provide savings accounts through a personalised mobile app, and will soon be expanding to offer current accounts, mortgages and a raft of other financial service products in an effort to revolutionise Banking by completely digitising the format.